Credit Tier, Financing Term Affect Brand Loyalty, Experian Says

Manufacturers on the prowl for brand-loyal customers might want to look toward consumers with lower credit scores.

Consumers in the deep-subprime credit range ― those with a VantageScore less than 600 ― tended to be more likely than those in the super-prime range ― with a VantageScore higher than 800 ― to stick with the same brand for their next new-vehicle purchase, according to Experian Automotive.

For its credit score analysis, Experian monitored financing trends from Mercedes-Benz Financial, Toyota Financial Services, American Honda Finance Corp., Ford Motor Credit Co., BMW Bank NA, and Nissan-Infiniti Financial Services. For all but Mercedes-Benz, brand loyalty slipped from the lowest to the highest credit tiers.

For instance, 65% of Nissan-Infiniti’s deep-subprime customers were brand-loyal, compared with 42% of the captive’s super-prime customers. For American Honda Finance the percentage drop was smaller, falling to 55% from 62%.

“Variations in finance type and lending source can have large impact on customer loyalty,” said Jeffrey Anderson, director of consulting and analytics at Experian Automotive, during a webinar about marketshare trends. “The degree to which manufacturers and lenders capitalize on this varies.”

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